UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED September 30, 2006
BALTIA AIR LINES, INC.
(Exact name of registrant as specified in its charter)
STATE of NEW YORK 11-2989648
(State of Incorporation) (IRS Employer Identification No.)
6325 SAUNDERS STREET, SUITE 7I, REGO PARK, NY 11374
(Address of principal executive offices)
Registrant's telephone number, including area code: (718) 275-5205
Check whether the issuer (1) filed all reports required to be filed by
Section 13, or 15(d) of the Exchange Act during the past 12 months (or
for such shorter period that the registrant was required to file such
reports), and (2) has been subject to such filing requirements for the
past 90 days. No [ ] Yes [X]
Indicate by an (X) whether the registrant is a shell company
(as defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [X]
As of November 13, 2006 the issuer had 97,802,009 shares of common stock
outstanding.
Transitional Small Business Disclosure Format (Check one): No [X]
PART ONE - FINANCIAL INFORMATION
Item 1. Financial Statements.
BALTIA AIR LINES, INC.
BALANCE SHEETS
(A Development Stage Company)
ASSETS
9/30/2006 12/31/2005
(Unaudited)
Current Assets
Cash $ 6,822 $ 14,947
Plant and Equipment
Equipment 62,464 62,464
Less Accumulated Depreciation (60,596) (60,353)
Net Property, Plant and Equipment 1,868 2,111
TOTAL ASSETS $ 8,690 $ 17,058
LIABILITIES AND STOCKHOLDERS EQUITY
Current Liabilities
Accounts Payable $ 1,200 $ 1,200
Equity
Preferred Stock 665 665
Common Stock 9,032 6,730
Paid-in-Capital 10,180,597 9,293,365
Deficit Accumulated During
Development Stage (10,182,804) (9,284,902)
Total Equity 7,490 15,858
TOTAL LIABILITIES AND
STOCKHOLDERS EQUITY $ 8,690 $ 17,058
See notes to unaudited interim financial statements.
STATEMENT OF OPERATIONS
(A Development Stage Company)
Three Months Ended Six Months Ended August 24, 1989
Sept 30, Sept 30, (Inception) to
2006 2005 2006 2005 Sept 30, 2006
(Unaudited)(Unaudited) (Unaudited)(Unaudited) (Unaudited)
Revenues $ 0 0 0 0 0
Costs & Expenses
General and
Administrative $ 95,628 $ 95,835 $ 897,659 $ 487,936 $ 7,808,213
FAA Certification 0 0 0 0 206,633
Training Expense 0 0 0 0 225,637
Depreciation 81 1,601 243 4,803 306,269
Other 0 0 0 0 568,245
Interest 0 0 0 0 1,066,659
Total expenses 95,709 97,436 897,902 492,739 10,181,656
Loss before
income taxes (95,709) (97,436) (897,902) (492,739) (10,182,804)
Income Taxes 0 0 0 0 1,148
Deficit Accumulated During
Development Stage: (95,709) (97,436) (897,902) (492,739) (10,182,804)
Per share amounts:
Loss Nil Nil ($0.01) Nil
Weighted Average Shares
Outstanding 83,614,500 64,420,270 79,880,783 63,051,489
See notes to unaudited interim financial statements.
STATEMENT OF CASH FLOWS
(A Development Stage Company)
Three Months Ended Aug 24, 1989
Sept 30, (inception)to
2006 2005 Sept 30, 2006
(Unaudited) (Unaudited) (Unaudited)
Cash flows from Operating Activities:
Deficit Accumulated During
Development Stage $(897,902) $ (492,739) $ (10,182,802)
Adjustments to reconcile net
loss to net cash provided by
operations:
Depreciation 243 4,803 306,269
Expenses paid by issuance of
common stock 816.328 340,853 1,469,952
(Increase) decrease in prepaid
expenses 0 0 400,301
Change in payables & accrued expenses 0 (2,484) 3,152,681
Cash used by operating activities: (57,703) (104,002) (4,853,601)
Cash flows from investing activities:
Purchase of Equipment 0 0 (311,339)
Deposit on Airplane Lease 0 0 0
Cash used in investing activities: 0 0 (311,339)
Cash flows from financing activities:
Issuance of Common Stock 73,206 134,644 4,686,426
Issuance of Preferred Stock 0 0 2,753
Loans from related parties 0 0 1,351,573
Repayment of related party loans 0 0 (368,890)
Acquisition of Treasury Stock 0 0 (500,100)
Cash generated by financing: 73,206 134,644 5,171,762
Change in cash (8,125) (14,923) 6,822
Cash-beginning of period 14,947 36,036 0
Cash -end of period 6,822 21,113 6,822
See notes to unaudited interim financial statements.
NOTES TO FINANCIAL STATEMENTS
BALTIA AIR LINES, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO UNAUDITED INTERIM FINANCIAL STATEMENTS
September 30, 2006
1. Basis of Presentation
The Financial Statements presented herein have been prepared by us in
accordance with the accounting policies described in our December 31,
2005 Annual Report on Form 10-KSB and should be read in conjunction
with the notes to financial statements which appear in that report.
The preparation of these financial statements in conformity with
accounting principles generally accepted in the United States requires
us to make estimates and judgments that affect the reported amounts of
assets, liabilities, revenues and expenses, and related disclosure of
contingent assets and liabilities. On an on going basis, we evaluate
our estimates, including those related to intangible assets, income
taxes, insurance obligations and contingencies and litigation. We base
our estimates on historical experience and on various other assumptions
that are believed to be reasonable under the circumstances, the results
of which form the basis for making judgments about the carrying values
of assets and liabilities that are not readily apparent from other
resources. Actual results may differ from these estimates under different
assumptions or conditions.
In the opinion of management, the information furnished in this Form
10-QSB reflects all adjustments necessary for a fair statement of the
financial position and results of operations and cash flows as of and
for the three and nine-month periods ended September 30, 2006 and 2005.
All such adjustments are of a normal recurring nature. The Financial
Statements have been prepared in accordance with the instructions to
Form 10-QSB and therefore do not include some information and notes
necessary to conform to annual reporting requirements.
The financial statements have been presented in a "development stage"
format. Since inception, our primary activities have been raising of
capital, obtaining financing and obtaining route authority and approval
from the U.S. Department of Transportation. We have not commenced our
principal revenue producing activities.
2. Earnings/Loss Per Share
Basic earnings per share is computed by dividing income available to
common shareholders (the numerator) by the weighted-average number of
common shares outstanding (the denominator) for the period. Diluted
earnings per share assumes that any dilutive convertible securities
outstanding were converted, with related preferred stock dividend
requirements and outstanding common shares adjusted accordingly. It
also assumes that outstanding common shares were increased by shares
issuable upon exercise of those stock options for which market price
exceeds the exercise price, less shares which could have been purchased
by us with the related proceeds. In periods of losses, diluted loss per
share is computed on the same basis as basic loss per share as the
inclusion of any other potential shares outstanding would be anti-dilutive.
Due to the net losses reported, dilutive common equivalent shares were
excluded from the computation of diluted loss per share, as inclusion
would be anti-dilutive for the periods presented
If we had generated earnings during the three and nine-month period ended
September 30, 2006, we would have added 39,939,500 common equivalent
shares, to the weighted average shares outstanding to arrive at diluted
weighted average shares outstanding. This consists of 39,740,000 stock
options and warrants outstanding and exercisable with exercise prices
below the average share price for the period and 199,500 shares issuable
upon the conversion or our Preferred Stock.
If we had generated earnings during the three and nine-month period
ended September 30, 2005, we would have added 39,939,500 common equivalent
shares, to the weighted average shares outstanding to arrive at diluted
weighted average shares outstanding. This consists of 39,740,000 stock
options and warrants outstanding and exercisable with exercise prices
below the average share price for the period and 199,500 shares issuable
upon the conversion or our Preferred Stock.
3. Stockholders' Equity
Stock Issued for Services During the Three Months Ended September 30:
During the quarter ended September 30, 2006 we issued 900,000 shares of
our common stock in exchange for services. The shares were valued at
$72,000 or about $0.08 per share and reflected the share market value at
the time of issuance. The shares are not registered and are subject to
restrictions as to transferability.
During the quarter ended September 30, 2005 we issued 508,000 shares
of our common stock in exchange for services. The shares were valued
at $50,000 or about $0.10 per share and reflected the share market
value at the time of issuance. The shares are not registered and are
subject to restrictions as to transferability.
Stock Issued For Cash
During the quarter ended September 30, 2006 we issued 200,000 shares
of our common stock for a total of $4,000. The shares are not
registered and subject to restrictions as to transferability.
Stock Issued Due to Exercise of Warrants & Options
During the quarter ended September 30, 2006 we issued 8,000,000 shares
of our common stock due to the exercise of options or warrants which
resulted in proceeds to the company of $23,393. The exercised options
ranged from $0.0001 to $0.05 per share. The shares are not registered
and subject to restrictions as to transferability.
4. New Accounting Standards-Adoption of SFAS 123R
On January 1, 2006, the Company adopted the provisions of Statement
of Financial Accounting Standards ("SFAS") 123R, "Share-Based Payment"
("SFAS 123(R)"), which requires that companies measure and recognize
compensation expense at an amount equal to the fair value of share-based
payments granted under compensation arrangements. Prior to January 1,
2006, the Company accounted for its stock-based compensation plans under
the recognition and measurement principles of Accounting Principles Board
("APB") Opinion 25, "Accounting for Stock Issued to Employees," and
related interpretations, and recognized no compensation expense for
stock option grants since all options granted had an exercise price
equal to the market value of the underlying common stock on the date
of grant.
The Company adopted SFAS 123(R) using the "modified prospective" method,
which results in no restatement of prior period amounts. Under this
method, the provisions of SFAS 123(R) apply to all awards granted or
modified after the date of adoption. In addition, compensation expense
must be recognized for any unvested stock option awards outstanding
as of the date of adoption on a straight-line basis over the remaining
vesting period. The Company calculates the fair value of options using
a Black-Scholes option pricing model. For the three and nine months
ended September 30, 2006 and 2005, the Company's recognized (2005 on a
pro forma basis) no compensation expense related to stock option grants.
The Company did not grant any options during the nine months ended
September 30, 2006.
SFAS 123(R) also requires the benefits of tax deductions in excess of
recognized compensation expense to be reported in the Statement of
Cash Flows as a financing cash inflow rather than an operating cash
inflow. In addition, SFAS 123(R) required a modification to the Company's
calculation of the dilutive effect of stock option awards on earnings
per share. For companies that adopt SFAS 123(R) using the "modified
prospective" method, disclosure of pro forma information for periods
prior to adoption must continue to be made.
As of September 30, 2006, there was no unrecognized compensation
cost related to non-vested options granted under the plan. The
total fair value of shares vested during the nine-month period
ended September 30, 2006 was $0 (also none during the nine-month
period ended September 30, 2005).
Item 2. Management's Discussion and Analysis and Plan of Operation.
The following discussion includes certain forward-looking statements
within the meaning of the safe harbor protections of Section 27A of
the Securities Act of 1933, as amended, and Section 21E of the Securities
Exchange Act of 1934, as amended. Statements that include words such as
"believe," "expect," "should," intend," "may," "anticipate," "likely,"
"contingent," "could," "may," or other future-oriented statements, are
forward-looking statements. Such forward-looking statements include, but
are not limited to, statements regarding our business plans, strategies
and objectives, and, in particular, statements referring to our
expectations regarding our ability to continue as a going concern,
generate increased market awareness of, and demand for, our current
products, realize profitability and positive cash flow, and timely
obtain required financing. These forward-looking statements involve
risks and uncertainties that could cause actual results to differ from
anticipated results. The forward-looking statements are based on our
current expectations and what we believe are reasonable assumptions
given our knowledge of the markets; however, our actual performance,
results and achievements could differ materially from those expressed
in, or implied by, these forward-looking statements.
Our fiscal year ends on December 31. References to a fiscal year
refer to the calendar year in which such fiscal year ends.
OVERVIEW
The Company was organized in the State of New York, August 24,
1989. Its objective is to provide scheduled air transportation from
the U.S. to Russia, and former Soviet Union countries. In 1991,
the Department of Transportation (DOT) granted the Company routes
to provide non-stop passenger, cargo and mail service from JFK to
St. Petersburg and from JFK to Riga, with online service to Minsk,
Kiev and Tbilisi as well as back up service to Moscow. For lack of
sufficient working capital, the US Department of Transportation
terminated the Company's route authority without prejudice to
reapply when financing was in hand. Since such time, Baltia has engaged
in market research, operations development and planning, as well as
activities to raise requisite funding. These costs are borne by Baltia
shareholders and principals.
With the exception of the JFK - Moscow route, there exists no
non-stop competitive air transportation service on the routes for
which Baltia can reapply pending financing. Baltia intends to
supply full service, i.e. passenger, cargo and mail, and will
not be dependent upon one or a few major customers. Baltia has
two registered trademarks "BALTIA" and "VOYAGER CLASS"
and five trademarks subject to registration.
The accompanying consolidated financial statements have been prepared
on a going concern basis, which contemplates the realization of assets
and the satisfaction of liabilities in the normal course of business.
The Company's starting revenue operations is dependent upon its timely
procuring significant external debt and/or equity financing to fund its
immediate and nearer-term operations, and subsequently realizing
operating cash flows from ticket sales sufficient to sustain its
longer-term operations and growth initiatives.
CRITICAL ACCOUNTING POLICIES
Our discussion and analysis of our financial condition and results of
operations are based upon our financial statements, which have been
prepared in accordance with accounting principles generally
accepted in the U.S. The preparation of our financial statements
requires us to make certain estimates, judgments and assumptions
that affect the reported amounts of assets and liabilities
at the date of the consolidated financial statements and the reported
amounts of revenues and expenses during the reporting period. Our
estimates, judgments and assumptions are continually re-evaluated
based upon available information and experience. Because of the use
of estimates inherent in the financial reporting process, actual results
could differ from those estimates. Areas in which significant judgment
and estimates are used include, but are not limited to valuation of
long lives assets and deferred income taxes.
Valuation of Long-Lived Assets: We review the recoverability of our
long-lived assets, including buildings, equipment and intangible assets,
when events or changes in circumstances occur that indicate that the carrying
value of the asset may not be recoverable. The assessment of possible
impairment is based on our ability to recover the carrying value of
the asset from the expected future pre-tax cash flows (undiscounted and
without interest charges) of the related operations. If these cash flows
are less than the carrying value of such asset, an impairment loss is
recognized for the difference between estimated fair value and carrying
value. Our primary measure of fair value is based on discounted cash flows.
The measurement of impairment requires management to make estimates of these
cash flows related to long-lived assets, as well as other fair value
determinations.
We amortize the costs of other intangibles (excluding goodwill) over their
estimated useful lives unless such lives are deemed indefinite. Amortizable
intangible assets are tested for impairment based on undiscounted cash
flows and, if impaired, written down to fair value based on either
discounted cash flows or appraised values. Intangible assets with
indefinite lives are tested for impairment, at least annually, and
written down to fair value as required.
On January 1, 2006, the Company adopted the provisions of Statement of
Financial Accounting Standards ("SFAS") 123R, "Share-Based Payment"
("SFAS 123(R)"), which requires that companies measure and recognize
compensation expense at an amount equal to the fair value of share-based
payments granted under compensation arrangements. Prior to January 1,
2006, the Company accounted for its stock-based compensation plans under
the recognition and measurement principles of Accounting Principles Board
("APB") Opinion 25, "Accounting for Stock Issued to Employees," and related
interpretations, and recognized no compensation expense for stock option
grants since all options granted had an exercise price equal to the market
value of the underlying common stock on the date of grant.
The Company adopted SFAS 123(R) using the "modified prospective" method,
which results in no restatement of prior period amounts. Under this method,
the provisions of SFAS 123(R) apply to all awards granted or modified after
the date of adoption. In addition, compensation expense must be recognized
for any unvested stock option awards outstanding as of the date of adoption
on a straight-line basis over the remaining vesting period. The Company
calculates the fair value of options using a Black-Scholes option pricing
model. For the three months ended June 30, 2006 and 2005, the Company's
recognized (2005 on a pro forma basis) no compensation expense related
to stock option grants.
Income Taxes: We must make certain estimates and judgments in
determining income tax expense for financial statement purposes.
These estimates and judgments occur in the calculation of certain
tax assets and liabilities, which arise from differences in the
timing of recognition of revenue and expense for tax and financial
statement purposes.
Deferred income taxes are recorded in accordance with SFAS No. 109,
"Accounting for Income Taxes," or SFAS 109. Under SFAS No. 109,
deferred tax assets and liabilities are determined based on the
differences between financial reporting and the tax basis of
assets and liabilities using the tax rates and laws in effect
when the differences are expected to reverse. SFAS 109 provides
for the recognition of deferred tax assets if realization of
such assets is more likely than not to occur.
Realization of our net deferred tax assets is dependent
upon our generating sufficient taxable income in future
years in appropriate tax jurisdictions to realize benefit
from the carry-forwards. We have determined it more likely
than not that these timing differences will not materialize
and have provided a valuating allowance against substantially
all of our net deferred tax assets. Management will continue
to evaluate the realizability of the deferred tax asset and
its related valuation allowance. If our assessment of the
deferred tax assets or the corresponding valuation allowance
are to change, we would record the related adjustment to income
during the period in which we make the determination. Our tax
rate may also vary based on our results and the mix of income
or loss in domestic and foreign tax jurisdictions in which we
operate.
In addition, the calculation of our tax liabilities involves
dealing with uncertainties in the application of complex tax
regulations. We recognize liabilities for anticipated tax audit
issues in the U.S. and other tax jurisdictions based on our estimate
of whether, and to the extent to which, additional taxes will be due.
If we ultimately determine that payment of these amounts is unnecessary,
we will reverse the liability and recognize a tax benefit during the
period in which we determine that the liability is no longer
necessary. We will record an additional charge in our provision
for taxes in the period in which we determine that the recorded
tax liability is less than we expect the ultimate assessment to be.
Results of Operations
We had no revenues during the three months ended September 30, 2006 and
2005 because we do not fly any aircraft and cannot sell tickets.
Our general and administrative expenses decreased $207 to $95,628 in
the three months ended September 30, 2006 as compared to $95,835 in
the three months ended September 30, 2005. This decrease is mainly
the result of decreased activity in preparing for air carrier certification.
Primarily as a result of the foregoing, we incurred a net loss of
$95,709 in the three months ended September 30, 2006 as compared to
a net loss of $97,436 in the three months ended September 30, 2005.
Our future ability to achieve profitability in any given future fiscal
period remains highly contingent upon us beginning flight operations.
Our ability to realize revenue from flight operations in any given
future fiscal period remains highly contingent upon us obtaining
significant equity infusions and/or long-term debt financing sufficient
to fund leasing and operating a Boeing 747. Even if we were to be
successful in procuring such funding, there can be no assurance that
we will be successful in commencing revenue operations or, if commenced,
that such operations would be profitable.
LIQUIDITY AND CAPITAL RESOURCES
Since our inception, we have incurred substantial operating and net
losses, as well as negative operating cash flows. As of September 30,
2006, our working capital was $5,622 and our stockholders' equity was
$7,490. This reflects a decrease from September 30, 2005 when our
working capital was $19,913 and our stockholders' equity was $22,714.
We had a cash balance of $6,822 at September 30, 2006, as compared to
$21,113 at September 30, 2005.
Our operating activities utilized $23,628 in cash during the three
months ended September 30, 2006, a decrease of $22,205 from the $45,833
in cash utilized during the three months ended September 30, 2005.
Our financing activities, from issuance of common stock, provided $27,393
and $47,200 in cash during the three months ended September 30, 2006 and
2005, respectively.
As a result of the foregoing, our unrestricted cash decreased by $14,291
to $6,822 at September 30, 2006, as compared to $21,113 at September 30,
2005.
We had no significant planned capital expenditures, budgeted or otherwise,
as of September 30, 2006.
Item 3. Controls and Procedures.
Our Chief Executive Officer and Chief Financial Officer, based on
evaluation of our disclosure controls and procedures (as defined in
Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934,
as amended) required by paragraph (b) of Rule 13a-15 or Rule 15d-15,
as of September 30, 2006, have concluded that our disclosure controls
and procedures were effective in ensuring that information required to
be disclosed by us in the reports that we file or submit under the
Exchange Act is recorded, processed, summarized and reported within
the time periods specified in the Commission's rules and forms. Our
Chief Executive Officer and Chief Financial Officer also concluded that,
as of September 30, 2006, our disclosure controls and procedures are
effective in ensuring that information required to be disclosed by us
in the reports that we file or submit under the Exchange Act is
accumulated and communicated to our management, including our Chief
Executive Officer and Chief Financial Officer, to allow timely decisions
regarding required disclosure.
There was no change in our internal controls or in other factors
that could affect these controls during our last fiscal quarter that
has materially affected, or is reasonably likely to materially affect,
our internal control over financial reporting. While existing controls
may be adequate at present, upon the commencement of flight revenue
service we intend to implement controls appropriate for airline operations.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
None.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
During the quarter ended September 30, 2006 we issued 900,000 shares of
our common stock in exchange for services. The shares were valued at
$72,000 or about $0.08 per share and reflected the share market value
at the time of issuance. The shares are not registered and are subject
to restrictions as to transferability.
During the quarter ended September 30, 2005 we issued 508,000 shares
of our common stock in exchange for services. The shares were valued
at $50,000 or about $0.10 per share and reflected the share market
value at the time of issuance. The shares are not registered and are
subject to restrictions as to transferability.
During the quarter ended September 30, 2006 we issued 200,000 shares
of our common stock for a total of $4,000. The shares are not
registered and subject to restrictions as to transferability.
During the quarter ended September 30, 2006 we issued 8,000,000
shares of our common stock due to the exercise of options or warrants
which resulted in proceeds to the company of $23,393. The exercised
options ranged from $0.0001 to $0.05 per share. The shares are not
registered and subject to restrictions as to transferability.
All of the above issuances were deemed to be exempt under rule 506
of Regulation D and Section 4(2) of the Securities Act of 1933, as
amended. No advertising or general solicitation was employed in
offering the securities. The offerings and sales were made to a
limited number of persons, all of whom were accredited investors,
business associates of the Company or executive officers of the Company,
and transfer was restricted. In addition to representations by the
above-referenced persons, we have made independent determinations that
all of the above-referenced persons were accredited or sophisticated
investors, and that they were capable of analyzing the merits and risks
of their investment, and that they understood the speculative nature
of their investment. Furthermore, all of the above-referenced persons
were provided with access to our Securities and Exchange Commission
filings.
Item 3. Default Upon Senior Securities.
None.
Item 4. Submission of Matters to a Vote of Security Holders.
None.
Item 5. Other Information.
None.
Item 6. Exhibits.
31.1 Certification by Chief Executive Officer and Chief Financial
Officer pursuant to Sarbanes-Oxley Section 302, provided herewith.
32.1 Certification by Chief Executive Officer and Chief Financial
Officer pursuant to 18 U.S. C. Section 1350, provided herewith.
SIGNATURES
Pursuant to the requirements of Section 12 of the Securities Act
of 1934, the registrant has duly caused this registration statement
to be signed on its behalf by the undersigned thereunto duly authorized.
DATED THIS 13th DAY OF NOVEMBER
BALTIA AIR LINES, INC.
/s/ Igor Dmitrowsky
------------------------
Igor Dmitrowsky
Chief Executive Officer and Chief Financial Officer
(principal accounting officer)
EXHIBIT 31.1
BALTIA AIR LINES, INC.
OFFICER'S CERTIFICATE PURSUANT TO SECTION 302
I, Igor Dmitrowsky, the Chief Executive Officer and Chief Financial
Officer of Baltia Air Lines, Inc., certify that:
1. I have reviewed this quarterly report on Form 10-QSB of Baltia Air Lines,
Inc.;
2. Based on my knowledge, this report does not contain any untrue
statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which
such statements were made, not misleading with respect to the period
covered by this report;
3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material
respects the financial condition, results of operations and cash flows
of the small business issuer as of, and for, the periods presented in
this report;
4. The small business issuer's other certifying officer(s) and I are
responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e))
for the small business issuer and have:
(a) Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our supervision,
to ensure that material information relating to the small business
issuer, including its consolidated subsidiaries, is made known to us
by others within those entities, particularly during the period in
which this report is being prepared;
(b) Evaluated the effectiveness of the small business issuer's
disclosure controls and procedures and presented in this report our
conclusions about the effectiveness of the disclosure controls and
procedures, as of the end of the period covered by this report based
on such evaluation; and
(c) Disclosed in this report any change in the small business
issuer's internal control over financial reporting that occurred
during the small business issuer's most recent fiscal quarter
(the small business issuer's fourth fiscal quarter in the case of
an annual report) that has materially affected, or is reasonably
likely to materially affect, the small business issuer's internal
control over financial reporting; and
5. The small business issuer's other certifying officer(s) and
I have disclosed, based on our most recent evaluation of internal
control over financial reporting, to the small business issuer's
auditors and the audit committee of the small business issuer's
board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the
design or operation of internal control over financial reporting
which are reasonably likely to adversely affect the small business
issuer's ability to record, process, summarize and report financial
information; and
(b) Any fraud, whether or not material, that involves management
or other employees who have a significant role in the small business
issuer's internal control over financial reporting.
Date: November 13, 2006
/s/ Igor Dmitrowsky
------------------------
Igor Dmitrowsky
Chief Executive Officer and Chief Financial Officer
(principal accounting officer)
EXHIBIT 32.1
BALTIA AIR LINES, INC.
CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT
TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report Baltia Air Lines, Inc.
(the "Company") on Form 10-QSB for the period ended September 30, 2006
as filed with the Securities and Exchange Commission on the date
hereof (the Report), I, Igor Dmitrowsky, Chief Executive Officer and
Chief Financial Officer (principal accounting officer) of the Company,
certify, pursuant to 18 U.S.C. ss.1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002, that:
(1) The Report fully complies with the requirements of section 13(a)
or 15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all
material respects, the financial condition and results of operations
of the Company.
A signed original of this written statement required by Section 906
has been provided to Baltia Air Lines, Inc. and will be retained by
Baltia Air Lines, Inc. and furnished to the Securities and Exchange
Commission or its staff upon request.
Date: November 13, 2006
/s/ Igor Dmitrowsky
------------------------
Igor Dmitrowsky
Chief Executive Officer and Chief Financial Officer
(principal accounting officer)